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Subordinated Debentures | 3 Months Ended
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Mar. 31, 2012
Subordinated Debentures [Abstract] |
Subordinated Debentures |
9. |  | Subordinated Debentures
At March 31, 2012, five wholly-owned subsidiary grantor trusts established by former Nara Bancorp had issued $38 million of pooled Trust Preferred Securities ("trust preferred securities") and one wholly-owned subsidiary grantor trust established by former Center Financial Corporation had issued $18 million of trust preferred securities. Trust preferred securities accrue and pay distributions periodically at specified annual rates as provided in the indentures. The trusts used the net proceeds from the offering to purchase a like amount of subordinated debentures (the "Debentures") of BBCN Bancorp. The Debentures are the sole assets of the trusts. BBCN Bancorp's obligations under the subordinated debentures and related documents, taken together, constitute a full and unconditional guarantee by BBCN Bancorp of the obligations of the trusts. The trust preferred securities are mandatorily redeemable upon the maturity of the Debentures, or upon earlier redemption as provided in the indentures. BBCN Bancorp has the right to redeem the Debentures in whole (but not in part) on or after specific dates, at a redemption price specified in the indentures plus any accrued but unpaid interest to the redemption date. BBCN Bancorp also has a right to defer consecutive payments of interest on the debentures for up to five years. The following table is a summary of trust preferred securities and debentures at March 31, 2012:
|  |  |  |  | (Dollars in Thousands) |  |  |  |  |  |  |  |  |  |  |  |  |
Issuance Trust |  | Issuance Date |  |  | Trust Preferred Security Amount |  |  | Subordinated Debentures Amount |  |  | Rate Type |  |  | Initial Rate |  |  | Rate at March 31, 2012 |  |  | Maturity Date |
Nara Bancorp Capital Trust I |  |  | 3/28/2001 |  |  | $ | 10,000 |  |  | $ | 10,400 |  |  |  | Fixed |  |  |  | 10.18 | % |  |  | 10.18 | % |  |  | 6/8/2031 |
Nara Capital Trust III |  |  | 6/5/2003 |  |  |  | 5,000 |  |  |  | 5,155 |  |  |  | Variable |  |  |  | 4.44 | % |  |  | 3.62 | % |  |  | 6/15/2033 |
Nara Statutory Trust IV |  |  | 12/22/2003 |  |  |  | 5,000 |  |  |  | 5,155 |  |  |  | Variable |  |  |  | 4.02 | % |  |  | 3.42 | % |  |  | 1/7/2034 |
Nara Statutory Trust V |  |  | 12/17/2003 |  |  |  | 10,000 |  |  |  | 10,310 |  |  |  | Variable |  |  |  | 4.12 | % |  |  | 3.42 | % |  |  | 12/17/2033 |
Nara Statutory Trust VI |  |  | 3/22/2007 |  |  |  | 8,000 |  |  |  | 8,248 |  |  |  | Variable |  |  |  | 7.00 | % |  |  | 2.12 | % |  |  | 6/15/2037 |
Center Capital Trust I |  |  | 12/29/2003 |  |  |  | 18,000 |  |  |  | 12,869 |  |  |  | Variable |  |  |  |  |  |  |  | 3.42 | % |  |  | 1/7/2034 |
TOTAL ISSUANCE |  |  |  |  |  | $ | 56,000 |  |  | $ | 52,137 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
The Company's investment in the common trust securities of the issuer trusts of $2.0 million and $2.0 million at March 31, 2012 and December 31, 2011, respectively, is included in other assets. Although the subordinated debt issued by the trusts are not included as a component of stockholders' equity in the consolidated balance sheets, the debt is treated as capital for regulatory purposes. Specifically, under applicable regulatory guidelines, the $56 million of securities issued by the trusts qualify as Tier 1 capital, along with the $120 million of our outstanding Fixed Rate Cumulative Perpetual Preferred Stock, net of discount. The trust preferred security debt issuances are includable in Tier I capital up to a maximum of 25% of capital on an aggregate basis. Any amount that exceeds 25% qualifies as Tier 2 capital. At March 31, 2012, all of the $56 million of the trusts' securities qualified as Tier 1 capital along with the $120 million of preferred stock. In July 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act") was signed into law which, among other things, limits to bank holding companies having total assets of more than $15 billion the ability to treat trust preferred security debt issuances as Tier 1 capital. Since the Company had less than $15 billion in assets at March 31, 2012, under the Dodd-Frank Act, wewill be able to continue to include its existing trust preferred securities in Tier 1 capital.

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- Definition Disclosure of borrowings under subordinated debt agreements that qualify as available in computing net capital under SEC's uniform net capital rule, including restrictive covenants, collateral, interest rates and due dates, amounts due by date and amount owed in total. This element may be used for the entire Subordinated Borrowings disclosure as a single block of text. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Audit and Accounting Guide (AAG) -Number AAG-BRD -Chapter 4 -Paragraph 80 -Subparagraph Exhibit 4-8, 9 -IssueDate 2006-05-01 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Audit and Accounting Guide (AAG) -Number AAG-BRD -Chapter 4 -Paragraph 08 -IssueDate 2006-05-01 + Details
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